IN THE HIGH COURT OF JUSTICE QUEEN S BENCH DIVISION CLAIM NO. HQ08X01759 BETWEEN: (1) CRAIG JOSEPH (2) JASON JOSEPH (3) ANTHONY RAYMOND and (1) JASON SPILLER (2) 1311 EVENTS LIMITED Claimants Defendants CLAIMANTS AMENDED PRELIMINARY POINTS OF DISPUTE IN RESPECT OF THE DEFENDANTS BILL OF COSTS INCORPORATING THE DEFENDANT S POINTS OF REPLY TO THE PRELIMINARY POINTS OF DISPUTE PRELIMINARY POINT 1 BASE COSTS AND SUCCESS FEE 1. The information provided within the bill of costs does not justify the recovery of a success fee on the Defendants' costs. 2. The definition of win (page 14 of the bill of costs) states that "The claim is won if it is finally decided in your favour, whether by a court decision or an agreement." 3. The final Order (page 50 of the bill of costs) states inter alia that "There be Judgment for the Claimant for damages in the sum of 1p". 4. Therefore in accordance with the Defendants definition, the Defendants have clearly not "won" and no success fee is recoverable between the parties on their costs. 1
5. Should the Defendants provide further information which the Court considers justifies the recovery of a success then the Claimants reserve their right to dispute the level of the success fee claimed. 6. The Claimants submit that the outcome of this case does not satisfy the win definition contained within the Defendants CFA, and that as a result, the Claimants are not liable to pay any costs to the Defendants, whether base costs, success fee, or otherwise. 7. In the event of a win, the Defendants legal representatives are, pursuant to Clause 5.6 of the CFA, entitled to recover a success fee and are, pursuant to Clause 8.2 of the CFA, entitled to recover disbursements and base fees (as well as the success fee). 8. These are the only provisions within the CFA which entitle the legal representatives to be paid. The Defendants liability to pay costs is wholly conditional upon satisfying the win definition. A win within the contractual definition has not been achieved, the Defendants have no liability and in turn there is no indemnity for the Claimants to meet. 9. The win definition within the CFA is contained in clause 8.1 of the CFA, which states: The claim is won if it is finally decided in your favour, whether by a court decision or an agreement. 10. Whether the circumstances are such that the definition of win has been met will be a matter of contract, where the ordinary principles of contractual interpretation will apply 1. 11. The Defendants were found to have defamed the Claimants, and judgment was entered in the Claimants favour. Whilst the extent and/or impact of that loss was reduced by 1 See Friston scivil Costs: Law and Practice, 2 nd Edition ( Friston ), paragraph 9.404. 2
the nominal award, it cannot therefore be contended that the claim was finally decided [in the Defendants ] favour. 12. The Defendants argument presented before Tugendhat J. that The Claimants are not the successful party... is of no consequence to the contractual definition of whether the Defendants won. 13 It was open to the Defendants legal representatives to have defined win differently in the CFA, whether by reference to the quantum of any damages, the recovery of costs, or otherwise. That they did not tailor the CFA to a defamation case seems apparent from the definition of loss at clause 9.1, which states: The claim is lost if the court has dismissed your proceedings or you have stopped them on our advice. These were not the Defendant s proceedings, they were the Claimants. Also, the dismissal or cessation of the proceedings would essentially have been a good outcome for the Defendants, and hardly a loss. 14 For the avoidance of doubt, the Claimants detailed points of dispute are without prejudice to this point. Defendant s Reply 1. The preliminary issue now raised by the Claimants (for the first time in their amended Points of Dispute) is for a determination whether or not the win defined in the Defendant s CFA with David Price Solicitors and Advocates ( DPSA ) has been achieved. The CFA is attached at Appendix 1. 2. The relevant paragraphs of the CFA are as follows: 8.1 The claim is won if it is finally decided in your favour, whether by a court decision or agreement. 8.2 If you win, you are liable to pay our disbursements, our basic charges and success fee ( our costs ). The amount of these are not based on or limited by the 3
damages. Normally, you will be able to recover part or all of our costs from your opponents. 3. The claim was finally decided by Order dated 20 November 2012 (Appendix 2) wherein it was ordered that there be judgment for the Claimants for damages in the sum of 1p and that the Claimants do pay 75% of the Defendant s costs, such costs to be assessed if not agreed. 4. The Claimants, in an attempt to avoid payment of the costs awarded by Order dated 20 November 2012, now argue that the definition of win has not been achieved and therefore no costs are due to DPSA by the Defendant and, as a result of the operation of the indemnity principle, the Defendant is not able to recover any costs from the Claimants pursuant to the Order made. 5. It is noted that this argument was not included in the Claimants original Points of Dispute but latterly included by amendment only. 6. It is the Defendant s case that the claim was, obviously and properly, decided in the Defendant s favour by the Order made. As a result, the Defendant is liable to DPSA for his costs and is entitled to recover those costs (or 75% thereof, to be assessed) from the Claimants. 7. The Claimants, in interpreting the definition of win, appear to construe the meaning of win that, if judgment is entered for nominal damages (ie: of 1p), the claim cannot be decided in the Defendant s favour or that, if a finding on any issue of liability is made at trial in the Claimants favour, this precludes the overall outcome of the claim being finally decided in the Defendant s favour. 8. The language of the contract does not include reference to either judgment being entered or otherwise, or to any findings of liability. The Claimant cannot impute these factors into the definition of success or argue that they are decisive in determining whether or not success has been achieved. The approach to be 4
adopted is simply whether the claim was finally decided in the Defendant s favour. 9. Mr Justice Tugendhat was obviously of the view that the claim had been decided in the Defendant s favour in light of the costs order made, following the general rule (CPR44.3 (2) (a)) that the unsuccessful party will be ordered to pay the costs of the successful party. Following this rule, the Defendant is, prima facie, the successful party. In submissions at the costs hearing, on 15 November 2012, the Judge accepted that, in terms of costs, there was no difference between judgment for the Defendant and judgment for the Claimant in the sum of 1p. His starting point was that as the successful party the Defendant was entitled to all his costs. He then reduced the Defendant s entitlement to costs by 25% because he rejected part of the Defendant s evidence. 10. The intention of the parties in the context of the defined win when entering into the CFA is illustrated by Paragraphs 12.1 and 12.2 of the CFA, which define a reasonable offer of settlement (and it can be assumed that such a reasonable offer of settlement would constitute a win ): 12.2 We have agreed the following would constitute a reasonable offer of settlement:- A settlement that results in this practice s costs being paid and you not paying any money to your opponents. 11. This result has been achieved. Moreover, it evidences the fact that the purpose, as far as the Defendant is concerned, was to avoid paying money to the Claimants. A defendant generally has nothing to gain from being sued. Success for him is not giving anything to his opponent whether in costs or damages. It is implicit that the Defendant s success correlates to the Claimants failure to achieve what the Claimants seek from him. favour. The claim has been finally decided in the Defendant s 12. Lord Hoffmann summarised the principles by which contractual documents are nowadays construed in Investors Compensation Scheme Ltd v- West Bromwich Building Society [1998] 1 WLR 896. At page 912g, he said: 5
"The result has been, subject to one important exception, to assimilate the way in which such documents are interpreted by judges to the common sense principles by which any serious utterance would be interpreted in ordinary life. Almost all the old intellectual baggage of legal interpretation has been discarded. The principles may be summarised as follows: (1) Interpretation is the ascertainment of the meaning which the document would convey to a reasonable person having all the background knowledge which would reasonably have been available to the parties in the situation in which they were at the time of the contract. (2) The background was famously referred to by Lord Wilberforce as the "matrix of fact", but this phrase is, if anything, an understated description of what the background may include. Subject to the requirement that it should have been reasonably available to the parties and the exception to be mentioned next, it includes absolutely anything which would have affected the way in which the language of the document would have been understood by a reasonable man. (3) The law excludes from the admissible background the previous negotiations of the parties and their declarations of subjective intent. They are admissible only in an action for rectification. The law makes this distinction for reasons of practical policy and, in this respect only, legal interpretation differs from the way we would interpret utterances in ordinary life. The boundaries of this exception are in some respects unclear. But this is not the occasion on which to explore them. (4) The meaning which a document (or any other utterance) would convey to a reasonable man is not the same thing as the meaning of its words. The meaning of words is a matter of dictionaries and grammars; the meaning of the document is what the parties using those words against the relevant background would reasonably have been understood to mean. The 6
background may not merely enable the reasonable man to choose between the possible meaning of words which are ambiguous but even (as occasionally happens in ordinary life) to conclude that the parties must, for whatever reason, have used the wrong words or syntax: see Mannai Investments Co Ltd v- Eagle Star Life Assurance Co Ltd [1997] AC 749. (5) The "rule" that words should be given their "natural and ordinary meaning" reflects the common sense proposition that we do not easily accept linguistic mistakes, particularly in formal documents. On the other hand, if one would nevertheless conclude from the background that something must have gone wrong with the language, the law does not require judges to attribute to the parties an intention which they plainly could not have had. Lord Diplock made this point more vigorously when he said in Antios Compania Naviera SA v Salen Rederierna AB [1985] AC 191,201: If detailed semantic and syntactical analysis of words in a commercial contract is going to lead to a conclusion that defies business common sense, it must be made to yield to business common sense." 13. The application of the above test to CFAs was approved in (1) Nicholas Andrew Manning (2) Michael John Beggs v Kings College Hospital NHS Trust [2011] EWHC 2954 (QB) where Mr Justice Spencer held: My task is to ascertain the meaning which, in the quite exceptional circumstances of this case, these two CFAs would have conveyed to a reasonable person with all the background knowledge which would reasonably have been available to the parties in the situation in which they were at the time of the contract. 14. Furthermore, Mr Justice Spencer referred in his judgment (above) to Chitty on Contracts (30 th Edition) Volume 1 at paragraph 12-118: So the court is entitled (and indeed bound) to enquire beyond the language of the document and see what the circumstances were with reference to which words were used, and the object appearing from those circumstances which the person 7
using them had in view. The court must place itself in the same factual matrix as that in which the parties were. 15. In Prenn v Simmonds [1971] 1 WLR 1381 Lord Wilberforce referred to, in a similar vein, the genesis and objectively the aim of the transaction. 16. The guidance given by Lord Bingham MR (albeit in relation to making an award of costs) in Roache v News Group Newspapers [1998] EMLR 161 may also be of assistance (this was cited with approval by the Court of Appeal in Reynolds v Times Newspapers [1998] 3 WLR 862, which was cited by the Judge in his costs judgment): The judge must look closely at the facts of the particular case before him and ask: who, as a matter of substance and reality, has won? Has the plaintiff won anything of value which he could not have won without fighting the action through to a finish? Has the defendant substantially denied the plaintiff the prize which the plaintiff fought the action to win? 16. The CFA and the issue of whether the claim has been determined in the Defendant s favour or, conversely, the Claimants favour must be considered in light of the factual matrix at the time and the intentions of the parties: The Claimants claim was for damages (including aggravated damages and special damages), injunctive relief and the Claimants costs. In the Claim Form dated 7 May 2008 it was stated The Claimant expects to recover more than 15,000 ; Had the claim been successful the Defendant would, in all likelihood, have been made bankrupt; David Price Solicitors & Advocates entered into a CFA with the Defendant to defend the claim. The objective aim of that defence (and the CFA) was to avoid the payment of damages and costs to the Claimant and to recover costs on behalf of the Defendant (see reasonable offer of settlement ); 8
The objective aim of the CFA has been achieved and the claim has, on any objective analysis, been finally determined in the Defendant s favour. The Defendant has denied the Claimants the prize which the Claimants fought the action to win. 17. The claim concluded in the way that it did because the First Claimant (Mr Joseph) was publicly found to have carried out a sophisticated deception of the court (paragraphs 155 to 160 of judgment dated 26 October 2012) which destroyed his reputation. Mr Justice Tugendhat found that Mr Joseph forged documents and gave fraudulent evidence in an attempt to pervert the course of justice. The First Claimant s deception was exposed at trial. 18. The Claimants are not the successful party: an award of nominal damages is a failure not a success (see judgment on costs dated 20 November 2012: paragraph 3)(Appendix 3). 19. Mr Justice Tugendhat accepted in this judgment that, if the fraud of Mr Joseph had been admitted (as it should have been) before the trial then the claim would have been struck out as an abuse of process following Fairclough Homes Ltd v Summers [2012] 1 WLR 2004 (see paragraphs 12 and 15). 20. Had the fraud become apparent prior to the trial then, in the words of Mr Justice Tugendhat..if it had been possible for the Defendants to apply to strike out this claim before trial they would have done so, and it would certainly have been struck out. In the event of the claim being struck out, there could be no argument that the definition of win had not been achieved. It would be perverse if the perpetuation of the fraud up to and throughout the trial, which denied the Defendant the opportunity to strike out the claim, would then deny the Defendant entitlement to the costs award made by Mr Justice Tugendhat. 21. Considered from the Claimants perspective it cannot be said that the Claimants were the successful party. In September 2011, the Defendant offered an 9
undertaking and a drop-hands settlement with no order for costs (this would not have constituted a win under the CFA). This offer was rejected by the Claimants as they required some financial compensation. 22. As a result of exposed fraud, the Claimants reputations, which they issued proceedings purportedly in order to vindicate, were ruined. The Claimants did much worse than the settlement offered in 2011: rather than a drop-hands settlement they recovered no damages and were ordered to pay 75% of the Defendant s costs. The Claimants did not achieve any relief any sought in the Claim Form. 23. This argument is a last-ditch attempt by the Claimants to avoid the responsibilities of their perpetuated fraud and attempted perversion of the course of justice and should be rejected summarily. The Defendant has achieved his objective aim in the successful defence of the proceedings and the claim has been finally decided in his favour. As such, he is liable for costs under the terms of the CFA and entitled to recover these costs from the Claimants pursuant to the final Order made. 24. The Claimants (at paragraph 13 above) seek to rely on the definition of lose in clause 9.1 and suggest that the CFA was not tailored to a defamation claim. The definition is derived from the Law Society standard CFA on which the CFA in the present claim is based. It is self-evidently inapplicable to a defendant CFA (not a defamation claim). However, the definition of win in clause 8.1 is not linked to clause 9.1 and the obvious inapplicability of 9.1 is irrelevant. What matters is that clause 8.1 is applicable to a defendant CFA in a defamation claim. 25. The Claimants suggest that it was open to the legal representatives to have defined win differently. The Claimants provide two possibilities: reference to the quantum of any damages or the recovery of costs. Notably they do not suggest judgment for the defendant, which would be an obvious possibility for a legal 10
representative drafting a defendant conditional fee agreement. The fact that the CFA is not defined by reference to judgment or liability but by favour strongly suggests that it is not to be limited to the former. There are a number of problems in defining win by reference to a costs order. These would, no doubt, have been raised by the Claimants had the CFA been drafted in this way. The wording used, favour, most closely corresponds to the approach the Court takes in determining in whose favour a costs order should be made, as did the Judge in the present case. It is word that is actually used in the CFA and it clearly covers the outcome achieved. Whether other wording would have also covered it is irrelevant. 26. For all these reasons, it is not necessary to rely on what was discussed at the time the CFA was entered into. Further or alternatively, the communications between the Defendant and his legal representatives strongly support the construction contended for. 27. The Defendant seeks confirmation that the Claimants preliminary point will be withdrawn. This represents speculative and disproportionate satellite litigation. In the event that confirmation is not received within 14 days that this preliminary point will not be pursued, then within 21 days thereafter, the Defendant reserves the right to adduce witness evidence from David Price QC and himself supporting the above construction. PRELIMINARY POINT 2 PROPORTIONALITY 15. Costs are payable on the standard basis and the court must therefore be satisfied both as to proportionality and reasonableness. The base costs claimed (excluding the costs of preparing the bill, additional liabilities and VAT) amount to circa 317,403.93. 16. The Claimants contend that there can be no justification for this level of costs and that the test of necessity should be applied to each item challenged. In further support of 11
that submission the following areas demonstrate why the test of necessity should be engaged. 17. The Defendants instructed the Principal, David Price, to conduct their advocacy at an excessive hourly rate. As can be seen from the bill of costs he had overall conduct of the case and incurred additional costs over and above those associated with advocacy. 18. With regard to advocacy, it should be noted that in respect of the trial (15 to 18 October 2012) the bill of costs claims circa 111 hours in the documents item and a further 17 hours 48 minutes attending trial for the Principal at a cost of 57,960.00 plus VAT. By comparison the Claimants' counsel charged a brief fee of 15,000.00 plus VAT and refresher fees of 3,000.00 plus Vat, a total cost of 24,000.00 plus VAT. 19. During the trial the Defendants, at times, had 5 fee earners in attendance, the Principal, the Partner/Consultant, the Senior Associate, the Assistant Solicitor and the Trainee Solicitor. 20. A total of 863 hours 6 minutes was expended on documents by six different fee earners (Principal - 214 hours 54 minutes; Partner/Consultant - 163 hours 42 minutes; Senior Associate - 107 hours; Associate Solicitor - 259 hours 6 minutes; Trainee Solicitor - 77 hours 18 minutes; Paralegal - 14 hours 6 minutes) at a total cost of 249, 687.00 plus Vat. The overall time appears disproportionate, as does the extent of duplication between the various fee earners. Defendant s Reply 1. It is simple for a Claimant after the event, following an unsuccessful claim, to assert that the costs claimed are excessive or disproportionate. However, the Court must have regard to the fact that the Claimants have brought these costs onto themselves by bringing these defamation proceedings, fabricating evidence 12
and pursuing the claim (over 4 years) to a 4-day trial in an attempt to pervert the course of justice. 2. The Court will have regard to the factors at CPR44.5(3) when determining the proportionality of the costs claimed: Conduct: The Claimants were guilty of serious misconduct. In the judgment dated 26 November 2012 it was held: My finding that Mr Joseph has forged documents and given fraudulent evidence is a finding of an attempt to pervert the course of justice. That was serious misconduct.. This has led to considerable costs being incurred. Efforts made to resolve the dispute: In September 2011, ground down by 4 years of litigation and the continued threat of bankruptcy by these proceedings, the Defendant offered to resolve the dispute on a drop hands basis with an undertaking to be given and no order for costs to be made. This offer was rejected by the Claimants, knowing that they were attempting to mislead the Defendant and the Court and pervert the course of justice, as they required some financial compensation. The Claimants therefore pursued their claim to trial, where they lost. Amount or value involved: The damages sought were unspecified but included aggravated and special damages and the Claimants expected to recover in excess of 15,000 (see Claim Form). However, as with all defamation litigation the real value involved was the possibility of an adverse costs award which, in this case, would no doubt have bankrupted the Defendant. Importance of the Matter: It is evident that the reputational issues involved were of extreme importance to both parties. Indeed, this was so important to the Claimants that they were willing to perjure themselves in order to achieve success. The case became potentially life-changing for all parties involved. Particular Complexity and Novelty: The case was hard-fought throughout. The interlocutory decision of Mr Justice Eady on 22 May 2009 striking out 13
parts of the Defence was appealed to the Supreme Court reflecting some of the complexities of the pleaded claim. The case was effectively prepared for trial twice: initially it was due to be tried in 2009, and following the appellate proceedings was subsequently tried in late 2012. The case involved significant disputed factual evidence. Skill, Effort and Specialised Knowledge: The case was conducted by specialist media solicitors, David Price Solicitors & Advocates, and conducted by David Price QC, an eminent and renowned specialist in this field who acted throughout as advocate without external counsel being instructed. Time Spent on Case: The Claimants argue that the time spent on the case is excessive. The Defendant submits this was reasonable and proportionate (the proceedings being ongoing from 2008 to 2012); however, the time spent can be (and no doubt will be) assessed on the standard basis applying the test of reasonableness. The simple fact that significant time has been properly spent does not indicate that the costs are disproportionate. The Claimants comparison of David Price QC s preparation time to the Claimants counsel s fees is not a fair comparison as no doubt the Claimants solicitors spent time instructing counsel, conferring with counsel and reviewing the Claimants skeleton arguments etc which is not included in the above comparison. In addition, DPSA had to spend a significant amount of time dealing with unnecessary and speculative issues often belatedly raised by the Claimants: for example, the argument about the alleged breach of the Conduct of Employment Agencies and Employment Businesses Regulations 2003 and the alleged breach of implied contractual terms which were not originally pleaded. The place and circumstances where the work was done: The work was done in the City of London, defending a High Court trial of substance, in circumstances where losing the claim would have resulted in the Defendant s bankruptcy. It should also be noted that defendant CFAs in defamation proceedings are extremely rare because of the risks associated with defending such claims. DPSA is one of the few, if not the 14
only firm, that regularly acts for defendants on CFAs. In addition, the Defendant could not afford to be represented on any other basis so it was entirely appropriate that DPSA was instructed. 3. In all the circumstances set out above, it is submitted that the costs claimed ( 306,852.00 base profit costs and disbursements of 10,551.93) are proportionate and have the appearance of so being. The stricter test of necessity is not required. PRELIMINARY POINT 3 COSTS ESTIMATES 21. The Claimants note that the initial estimate provided to the Defendants stated that the costs to a fully contested trial would be 63,000.00 plus VAT. As previously stated the Defendants base costs were circa 317,403.93, over five times this figure. The Defendants are therefore requested to confirm whether updated estimates were provided to the Defendants. 22. Further, the Defendants estimate of costs dated 24 September 2012 and served 26 September 2012 states that the Defendants base costs to trial would be 213,871.00. There is therefore a difference of in excess of 20% which the Defendants have failed to provide an explanation for. Defendant s Reply The Claimants are aware that the initial costs estimate (subject to the caveats that it was) referred to in paragraph 21 was updated as they also refer to the updated estimate of costs in paragraph 22. Interlocutory statements of costs were also provided to the Defendant, the Court and the Claimants in respect of the appellate proceedings. The estimate of costs dated 24 September 2012 estimated base costs to trial of 213,871.00. A 20% marginal increase on this figure would equate to 256,645.20. This estimate was exceeded for the following reasons: 15
As part of the trial preparation, and given the Claimants response to DPSA s queries about the Casey-Lee Jolleys booking and the Claimants failure to admit to the fraudulent special damages claim when it was first raised, extensive investigations were undertaken into one of the Claimants witnesses, Mr David Hizer. However, it was subsequently discovered that he often used an alias (the surname Gershner) and had, in fact, spoken to the Defendant s solicitors using that alias in October 2008 when they were attempting to contact Mr Hizer. This led to a number of searches and investigations being undertaken and the preparation of the witness statement of Julia Varley dated 5 October 2012 and the witness statement of Dr Laurence Godfrey dated 9 October 2012. It was because of this revelation that further investigations were pursued against Mr Hizer right up to trial. Following the preparation of the Defendant s Skeleton Argument the case took a dramatic turn of events. It was subsequently discovered (on 11 October 2012) that the Claimants had performed at Mr Hizer s 50 th birthday party. The Claimants case on special damages was that Mr Hizer wanted nothing more to do with the Claimants after reading the posting complained of and that there had been no contact between the Claimants and Mr Hizer either before or afterwards. This was untrue and led to the urgent preparation of: i.) the first and second witness statements of Adrian Yapp; ii.) the first and second witness statements of Jayne Buchanan; iii.) the Note to the Judge dated 12 October 2012; iv.) the fourth witness statement of Craig Joseph; v.) the third witness statement of Adrian Yapp; vi.) the second witness statement of Julia Varley; and vii.) the first witness statement of Helen Morris. Had the First Claimant not perpetuated the fraud in relation to the special damages claim and that the Claimants had not performed at Mr Hizer s 50 th birthday party and persisted with the lie when confronted with the first statements of Mr Yapp and Mrs Buchanan, significant further costs would not 16
have needed to be incurred (which were obviously not included in the Defendant s estimate of costs). The closing arguments, judgment and costs submissions were extended and additional costs incurred as a result of the exposure of the Claimants attempts to pervert the course of justice. During the course of the trial the Judge acknowledged that uncovering the fraud would have required a lot of work on the part of DPSA. The estimate of costs did not include the expert s fees (and witness fees) of Dr Godfrey in the sum of approximately 9,000 plus VAT, which had not been invoiced at the time. In such circumstances, it is not surprising, and is reasonable, that the costs estimate provided on 24 September 2012 was exceeded. PRELIMINARY POINT 4 HOURLY RATES 23. The Claimants' contend that the hourly rates claimed are excessive. It is noted that the Defendant/Defendant company resides/is based in March, Cambridgeshire and therefore the Claimants' contend that it was unreasonable to instruct a City firm. The Claimants' will concede Central London guideline hourly rates. 23. It noted that an enhanced hourly rate has been claimed by the Principal, David Price, who undertook the advocacy on behalf of the Defendants. However, the Claimants' object to the enhanced rate as firstly, a large proportion of the work undertaken by him was clearly not advocacy. Secondly, the hourly rate claimed considerably exceeds the rates generally charged by counsel. Lastly, as is clear from the unreasonable level work undertaken by the Principal it would have been more cost effective to have instructed counsel. 24. The Claimants' concede the following rates:- 17
Principal (Grade A) Partner/Consultant (Grade A) Senior Associate (Grade A) Assistant Solicitor (Grade C) Trainee Solicitor Paralegal Costs Lawyer 317.00 per hour 317.00 per hour Conceded 196.00 per hour 126.00 per hour Conceded 126.00 per hour Defendant s Reply The Defendant acted reasonably in approaching a specialist firm of media lawyers when faced with defamation proceedings of significant consequence. The Defendant s instruction of David Price Solicitors & Advocates, based in the City of London, was prima facie, reasonable. The Defendant repeats the comments made in his reply to Preliminary Point 2 in relation to the availability of defendant CFAs in defamation proceedings. The paying parties offer Central London Guideline rates. This is despite the fact that the Guideline rates are intended for simple cases capable of summary assessment and are of limited assistance to experienced Costs judges and of limited application to specialist areas of litigation such as defamation proceedings, particularly defamation litigation of this scale and importance (where an interlocutory appeal was heard in the Supreme Court and the case concluded after a 4-day trial where the Claimants fraudulent activities were exposed). The hourly rates claimed reflect not only the location of the solicitors instructed but also the seniority, specialism and experience of the individuals involved. The Principal s rate to be allowed must therefore reflect the fact that David Price QC acted as advocate in the claim and the hourly rate allowed must reflect the responsibility accepted and the rate that would be allowed to leading counsel, if briefed for the substantive hearing (and to advise). 18
A rate of 450 per hour is reasonable for the principal of a specialist firm, who is also Queen s Counsel, and who appeared as advocate on behalf of the Defendant. It should be noted that Mr Price QC performs the dual role of solicitor and advocate and leads the litigation and advocacy teams. The rates offered for the Partner (Grade A fee-earner) of 317 per hour do not reflect the complex nature of these important proceedings and the other factors at CPR44.5 (3). The same applies to the rates claimed and offered for the Associate (Grade C) and Trainee Solicitor, whose rates claimed are reasonable. In summary, the rates claimed are reasonable taking into account the conduct of the Claimants, the facts of the case, the location, specialism and experience of the solicitors retained and the other factors at CPR44.5 (3). PRELIMINARY POINT 5 MULTIPLE ATTENDANCES 25. It is a feature of the bill that numerous fee earners attended court and meetings. The Claimants dispute the unreasonable attendance of multiple fee earners on a standard basis assessment. The Claimants concede the attendance of the Principal and one other fee earner only. Defendant s Reply This is not a preliminary issue capable of being determined at the outset of the detailed assessment. The reasonableness of the attendances referred to is a matter for the item by item detailed assessment. PRELIMINARY POINT 6 LONG TELEPHONE CALLS 19
26. The bill of costs states the dates and times expended on long telephone calls however, it fails to provide any detail of the issues discussed in these calls. Therefore, the Claimants are unable to ascertain the reasonableness of the times claimed. The Claimants reserve their position on these items pending clarification of the content of these long telephone calls by the Defendants. Defendant s Reply There is no CPR requirement to provide information regarding matters discussed in timed telephone attendances. Very often, this is obvious from the date of the same and any further information reasonably required in support will be provided on detailed assessment. PRELIMINARY POINT 7 DUPLICATION 27. The Claimants contend that there has been clear duplication between the fee earners and makes no concessions in relation to duplicated time. Defendant s Reply This is not a preliminary issue capable of being determined at the outset of the detailed assessment. The reasonableness of the attendances referred to is a matter for the item by item detailed assessment. PRELIMINARY POINT 8 LETTERS/E-MAILS 28. The Claimants note that non routine letters/e-mails are claimed within the documents item. The Defendants are requested to provide these letters/e-mails to the court in order that the Claimants can be satisfied that they are not routine. Further, the Defendants should confirm that these letters/e-mails are not also claimed within the routine items. 20